China's Global Impact Trends 2021: Digital Currency. Pascal's China Lens week 30

Title: China's Global Impact Trends 2021: Digital Currency
Website: https://www.pascalcoppens.com/

CONTENT: This video explains how China's Digital Currency Revolution is now going from 1.0 to 2.0 with the Central Bank Digital Currency Electronic Payment that will drive payments domestically and trade with China globally.

TRANSCRIPT
Welcome to the last episode of the trends of 2021 for China. I hope you liked this series so far.
It's been a lot about business trends, consumer trends, I talked about inclusion,
I talked about sustainability, about the new regulation. This last episode
is all about the digital currency in. China. How china is going to go into a
2.0 of digital payment; and how that will impact the world specifically on trade.
Now the last trends that I want to talk about is the digital currency. The digital currency is
something a lot of people have been talking about lately and this is new form of payment,
digital payment, which is taking shape in China first. Of course we all know about the digital currency 1.0
This was mobile payment and later on face payment. If you look at mobile payment in 2019,
China was already light years ahead of the rest of the world. Everybody in the urban
cities were paying cashless these days. And this was before the pandemic. Of course we caught up during
the pandemic, but China was way ahead and then there was face payments. This was really
showing the world: we are faster and more ahead on digital payments. But now this is going
to the next level. It's going to digital currency or digital payments 2.0.
What that means is that the central government in Beijing, the People's Bank of China
is issuing a digital currency which they're piloting in different cities now.
That was created from Beijing and this has two big differences with before -mobile payment -
one is that the money is sitting on your phone, it's not sitting in a bank account anymore,
where Alipay or WeChat Pay used to be just a transfer of different balance accounts. Now it's really sitting
on your phone, and you can transfer it from your phone. That's a big difference. The other thing is
that it's centralised; it's convertible with the RMB (renminbi), the Chinese currency one-on-one.
That is just like real cash money; there's no more difference. it's what Beijing wants now.
The concept behind the technology, is very similar to crypto. But we're making a mistake
when we compare with crypto thinking about blockchain or thinking about anonymous.
The central bank digital currency is not anonymous. What that means is that
you will get that money in your account or on your phone; but it will be real name registration;
which means the government knows it, your employer knows, it the bank knows it, people who
are giving you that money, or who are accepting money, know that money comes from you.
The interesting thing is that it's mandatory; what that means is that if you have
digital currency on your phone and you want to pay a vendor, the vendor will have to accept it.
He cannot say no. With WeChat or Alipay he can still say: no I want real cash. But with this currency
it's actually an official way of payment because it's similar to cash. The other misunderstanding is that
it's not on the blockchain. A lot of people think that because crypto is blockchain enabled,
that this digital currency would be on the blockchain. But the problem is there's just
hundreds of millions of transactions per second happening on WeChat and Alipay;
it would be impossible for the blockchain to cope with that. It would be just too slow.
So, blockchain is not the technology used. It's another technology very similar much more similar
to what banks are using today. The important thing is it's centralised; while blockchain is
a decentralised system. We're seeing the first digital currency centralised taking shape  in China.
This will go into many countries who will follow this example.
China has launched it last year as pilots and this year it should go officially into every city.
It's not clear yet when, but it's expected in 2021 that's why it's a big trend for 2021.
Right now, they're piloting it in Suzhou and a few other cities where they've given millions of Euros (in RMB)
in red envelopes away for free. Free money, 15 euro (100 RMB) per piece, and so people just got
free digital currency on their phone. The idea was then to start using it in the stores.
All the stores in Suzhou - 3 000 of them - where you could use that digital currency already.
So, this started this whole machine, this momentum.

KEYWORDS
Pascal Coppens, China, innovation, trends, keynote, speaker, public speaker, DCEP, CBDC, Blockchain, digital payment, SWIFT, mobile payment, Alipay, WechatPay

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